Slate on Gas
The problem with relying on price as the determinant is that it's not good at predicting the future or measuring externalities. The US wants to get away from dependency on foreign oil for political reasons. We want to get away from oil for environmental reasons. We know we're going to have to move away from gasoline at some point in the future, but today's prices will not get us there. For one thing, fuel prices are notoriously inelastic. That's because you get so much personal value from fuel that most people are willing to pay whatever, especially in the short term. Believe me, riding a bike to school with backpack and sousaphone is not feasible. It's not much fun on the bus either. People whine like spoiled teenagers, but gas prices today are the best deal around.
The hybrid is one part of the solution, and we should encourage it. I have a Civic and I love it for a dozen reasons. Hybrid, like front-wheel drive, is just plain better. The technical expertise gained at conjoining multiple power sources will pay off strategically for future transitions. The recent NYT Magazine has an article about a prototype diesel-hybrid sports car that does 0-60 in 4.3 seconds and gets 80 mpg. The guy thinks we have to burn rubber to get Americans interested. The next article talks about "grass guzzlers".
To unleash this sort of innovation it would be best if prices remained high. Alternate vehicles, alternate fuels, new technologies, mass transit, are all encouraged by predictably high fuel prices. Unfortunately the excess money ends up flowing into the coffers of the least productive, most socially retrograde and dangerous people in the world. The best way to handle it is to maintain high prices and reduced consumption using a percentage based tax. That means our government gets the money rather than those who would use it against us.
9/30/2005 11:10 AM
UPDATE: The link to Jane Galt's post may reject you. I think it has a BlogSpot filter in it for some spam-proofing reason. Just put your cursor on the linkbox and hit return. If that doesn't work, try cut-and-paste starting at another site.